This letter refers to an NRC inspection conducted on February 5
through 6, and March 27, 2003, at the Union City Diagnostic Center
(UCDC) facility in Union City, New Jersey. The inspection report
was sent to you on September 23, 2003. In addition, an investigation
was conducted by the NRC's Office of Investigations (OI) to determine
if UCDC knowingly engaged in activities under its license without
a Radiation Safety Officer (RSO) and an Authorized User (AU). The
OI investigation was completed on August 11, 2003. A synopsis of
the investigative findings was also sent to you on September 23,
2003. OI found that UCDC operated the facility without adequate oversight
of licensed activities since the former AU and RSO were not employed
at the facility for a period of approximately 7 months; however,
the NRC staff was unable to substantiate that UCDC willfully operated
the facility without adequate oversight, knowing that it was a violation
of NRC requirements.

A predecisional enforcement conference was scheduled to be held
with you as the representative from UCDC on October 2, 2003, and
again on October 7, 2003, to discuss the apparent violations, their
causes, and your corrective actions to prevent the violations from
recurring. You canceled both meetings due to other commitments. At
the time of those cancellations, the assets of UCDC had been seized
under the terms of bankruptcy proceedings. The NRC was notified of
these proceedings by Joshua Raymond, Esq. of Booker, Rabinowitz,
Trenk, Lubetkin, et al (BRTL), the trustee in the bankruptcy proceedings.
The NRC was also notified in another letter from BRTL dated November
24, 2003, that all radioactive material had been removed from the
former UCDC facility in Union City. In addition, the NRC received
your letter, dated December 2, 2003, which requested that your NRC
license be terminated.

Based on the information developed during the inspection and investigation,
the NRC has determined that three violations of NRC requirements
occurred. The violations are cited in the enclosed Notice of Violation
(Notice), and the circumstances surrounding them are described in
detail in the subject inspection report. The violations involved:
(1) your receipt, possession and use of a byproduct material without
the supervision of an AU between July 1, 2002, and January 29, 2003;
(2) your receipt, possession and use of a byproduct material without
the supervision of an RSO between July 1, 2002, and January 29, 2003;
and (3) the creation of false records indicating that the AU had
ordered licensed material during that period, when in fact, the AU
was no longer employed at your facility.

With respect to the first and second violation, the medical use
of byproduct material requires the supervision provided by an AU
and RSO to ensure that patient doses are administered properly and
safely. 10 CFR Part 35, revised October 24, 2002, continues to require
that radioactive material may only be used for medical purposes by,
or under the supervision of an AU. In the revised 10 CFR Part 35,
licensees are given flexibility in how supervised individuals are
evaluated. The AU is best suited to determine which tasks may be
delegated to a supervised individual. The licensee is responsible
for ensuring that tasks delegated by the AU receive the proper instruction
and supervision. Similar to the first violation, the second violation
involved the failure of the individual listed on the license to perform
the duties of the RSO.

With respect to the third violation, the NRC determined that the
AU did not order licensed material since he was not employed at the
facility between July 1, 2002, and January 29, 2003; however, your
facility records indicated that the AU had ordered this licensed
material for the facility. This record keeping violation is material
to the NRC because the NRC uses these records to determine compliance
with license requirements.

Although the NRC, after review of the OI findings, was unable to
substantiate that the violations were willful, the violations demonstrate
a lack of management attention to, and oversight of, NRC licensed
activities at the facility. The three violations have been collectively
categorized as a Severity Level III problem in accordance with the "General
Statement of Policy and Procedure for NRC Enforcement Actions" (Enforcement
Policy), NUREG-1600.

In accordance with the Enforcement Policy, a base civil penalty
in the amount of $3,000 is considered for a Severity Level III violation
involving the use of licensed materials without an AU and RSO. However,
since your company has filed for bankruptcy, you no longer possess
NRC-licensed material, you have requested that your NRC license be
terminated, and you are not currently involved in NRC-licensed activities,
the NRC has decided not to issue a civil penalty in this case.

Therefore, due to the specific circumstances in this case, I have
been authorized, after consultation with the Director, Office of
Enforcement, to issue the enclosed Notice of Violation with no civil
penalty for this Severity Level III violation. However, you should
be aware that if you decide to return to licensed activities, similar
violations in the future could result in a civil penalty. In addition,
issuance of this Notice constitutes escalated enforcement action
that may subject you to increased inspection effort.

You are not required to respond to this letter unless UCDC becomes
involved with NRC licensed activities in the future or the description
herein does not accurately reflect your corrective actions or your
position. In that case, or if you choose to provide additional information,
you should follow the instructions specified in the enclosed Notice
when preparing your response. In your response, you may reference
any previous correspondence that is applicable to this case to avoid
repetitive submissions.

On February 6, 2003, the NRC issued Confirmatory Action Letter (CAL)
No. 1-03-001 to you because you were conducting licensed activities
without an AU or RSO. Items 1 through 4 of the CAL confirmed that
you would cease all licensed activities until you obtained an AU
and RSO; repair the door to your hot lab and place all byproduct
material in your possession in secure storage; provide written statements
by the proposed AU and RSO that they understand and are willing to
perform their duties; and receive NRC approval, by license amendment,
for these changes. In an inspection conducted on March 27, 2003,
the NRC confirmed that you had repaired the door to your hot lab
and that you had placed all byproduct material in secure storage.
Based on these confirmations, Item 2 of the CAL was considered closed.
However, you were unable to obtain an AU and therefore, were unable
to satisfy Items 1, 3 and 4 of the CAL. On November 24, 2003, the
Chapter 11 trustee documented that all remaining NRC-licensed sources
were removed from the premises of UCDC as of November 20, 2003. In
addition, you requested the termination of your NRC license on December
2, 2003. Therefore, the NRC has determined that no further response
is required regarding these issues and the CAL is closed.

Also, please find enclosed Amendment No. 1 terminating License No.
29-30510-01 as requested by your letter dated December 2, 2003. This
termination is being issued in accordance with the requirements of
the applicable NRC License Termination Rule (10 CFR 30.36). All facilities
used for licensed activities may be released for unrestricted use.
Please note that you must apply for and receive a new NRC license
prior to any use of radioactive material. Also enclosed are guidance,
regulations, and forms which may be helpful to you if you choose
to submit a new license application in the future.

In accordance with 10 CFR 2.790 of the NRC's "Rules of Practice," a copy of this letter, its enclosures, and your response (if you choose to provide one) will be made available electronically for public inspection in the NRC Public Document Room or from the Publicly Available Records (PARS) component of NRC's document system (ADAMS). ADAMS is accessible from the NRC Web site at the Public NRC Library.

During an NRC inspection conducted on February 5, 2003, as well
as a subsequent investigation by NRC Office of Investigations, the
report of which was issued on August 11, 2003, three violations of
NRC requirements were identified. In accordance with the "General
Statement of Policy and Procedure for NRC Enforcement Actions," (Enforcement
Policy), NUREG-1600, the violations are set forth below:

A.

10 CFR 35.27 requires, in part, that
a licensee that permits the receipt, possession, use, or transfer
of byproduct material by an individual under the supervision
of an authorized user as allowed by 10 CFR 35.11(b)(1)
shall instruct and require the supervised individual to follow
the licensee's written radiation protection procedures, regulations,
and license conditions with respect to the medical use of byproduct
material; and shall instruct and require the supervised individual
to follow the authorize user's instruction on the preparation
of byproduct material for medical use.

Contrary to the above, as of June 2002, the licensee did not instruct and
require the supervised individual to follow the authorized user's instructions
on the preparation of byproduct material for medical use. Specifically,
the licensee's authorized users listed on the license, having resigned
from their positions in June 2002, no longer supervised individuals at
the licensee's facility after that date.

B.

10 CFR 35.24(b), requires that a licensee's management
shall appoint a Radiation Safety Officer, who agrees, in writing,
to be responsible for implementing the radiation protection program.
The licensee, through the Radiation Safety Officer, shall ensure
that radiation safety activities are being performed in accordance
with licensee-approved procedures and regulatory requirements.

Contrary to the above, as of June 2002, the licensee did not appoint a
Radiation Safety Officer, who agreed, in writing, to be responsible for
implementing the radiation protection program. In addition, the licensee
did not, through the Radiation Safety Officer, ensure that radiation safety
activities were being performed in accordance with licensee-approved procedures
and regulatory requirements. Specifically, the licensee's Radiation Safety
Officer listed on the license, having resigned from his position in June
2002, no longer served as Radiation Safety Officer at the licensee's facility
after that date.

C.

10 CFR 30.9 requires, in part, that information required
by license conditions to be maintained by the license shall be
complete and accurate in all material respects.

License Condition 15 of the license issued to Union City Diagnostic Center
requires that the licensee conduct its program in accordance with statements,
representations, and procedures contained in the application dated February
22, 1999, and letter dated May 3, 1999. Item 10.6 of the application dated
February 22, 1999, states 10 CFR 35.11 requires, in part, that
the licensee will establish and implement the model guidance for ordering
and receiving radioactive material that was published in Appendix K to
Regulatory Guide 10.8, Revision 2. Appendix K to Regulatory Guide 10.8,
Revision 2, requires that written records be made that identify the authorized
user when ordering radioactive materials.

Contrary to the above, the licensee maintained information required by
license conditions that was not complete and accurate in all material respects.
Specifically, the licensee maintained written records of byproduct material
ordered for medical use during the period from July 1, 2002, through January
29, 2003, that identified the authorized users listed in the license condition,
but the authorized users had resigned from the position, and were no longer
employed at the licensee's facility.

These violations are characterized as a Severity Level III problem (Supplement
VI).

You are not required to respond to this Notice of Violation at this
time. However, if Union City Diagnostic Center should become involved
with NRC licensed activities in the future, you must provide a written
response to the NRC, before you begin licensed activities, regarding
your corrective actions taken to prevent recurrence of the violation.
Also, you are required to submit a written statement or explanation
pursuant to 10 CFR 2.201 if the description therein does
not accurately reflect your corrective actions or your position.
In either case, or if you choose to respond, you should clearly mark
your response as a "Reply to a Notice of Violation, EA 03-170" and
send it to the U.S. Nuclear Regulatory Commission, ATTN: Document
Control Desk, Washington, DC 20555 with a copy to the Regional Administrator,
Region I, within 30 days of the date of the letter transmitting this
Notice of Violation (Notice).

If you contest this enforcement action, you should also provide
a copy of your response, with the basis for your denial, to the Director,
Office of Enforcement, United States Nuclear Regulatory Commission,
Washington, DC 20555-0001.

If you choose to respond, your response will be made available electronically for public inspection in the NRC Public Document Room or from the Publicly Available Records (PARS) component of NRC's document system (ADAMS). ADAMS is accessible from the NRC Web site at the Public NRC Library. Therefore, to the extent possible, the response should not include any personal privacy, proprietary, or safeguards information so that it can be made available to the Public without redaction.